Former chair of Citicorp, leader of the banking revolution that put ATMs on every street, member of many boards, and the defining business insider - that's Walter Wriston. Though now almost 80, Wriston remains active on the boards of several young companies, including high-tech start-ups. His firsthand views on how a chairman should lead a boardroom?
- Each director brings unique strengths to the boardroom, so learn them and tap them. "Each board member brings his or her own experiences. If I'm on a biotech company board, for instance, I may know how engineered proteins work. Each member can be very valuable."
- Assume that directors want (and need) to learn more. "At Citibank, it occurred to me one day that the directors didn't really understand the bank's accounting issues. I asked the board if they'd like to come an hour early to the next board meeting for a presentation on how bank accounting works, and every one of them signed up immediately." A smart chairman doesn't wait for the directors to ask for help. "You can sense whether or not what you're saying makes sense to them."
- The board will give you input one way or another, so try to make it positive. "Some chairmen may ask directors, 'What do you think of this idea?' and they'll tell you it's lousy, but at least that starts a dialogue. The major thing is open discussion - I've never seen a proposal that went before the board that didn't come out better."
- Still, seeking board input doesn't mean asking them what you should do. "You wouldn't bring an idea to the board if you didn't know what you wanted done. You have to be able to go in saying, 'This is what we want to do, and why it makes sense.' For a chair to go around the boardroom asking what he should do, that's very rare."
- You'll have to be good at reading people before you can read directors. "Mostly, if a chair senses that directors will consider an idea dumb, he just sends it back to the laundry. You have to read people."
- What's the quickest way for a board chairman to become ineffective? Not telling the truth. "Once that happens, the chairman is out of there. The integrity of the chair is the most important thing, and what you say has to be accurate to the best of your knowledge." Even pushing the envelope here will get you in trouble. "I had a recent case where the chairman was being truthful, but you had to be a district attorney to ask him the right question. It's crucial to be forthcoming with your board. None of that 'no controlling legal authority' stuff - that's absolutely out."
Copyright Â© 2000 Ralph Ward's Boardroom INSIDER